FAA Ch5 Flashcards
Additional paid-in capital
amount received over the par value upon the issuance of stock
Authorized shares
maximum number of shares that a corporation can issue
board of directors
group charged with protecting shareholder interests within the corporation
callable preferred stock
corporation has the right to repurchased the stock in the future
common stock
class of stock required for a corporation to exist. Shareholders having voting rights
convertible preferred stock
may be exchanged for common stock at a future date
cumulative preferred stock
unpaid dividends from prior years must be made up before current year dividends can be paid
declaration date
date the board of directors announces that it will pay a divdend
dividend payment date
date where dividends are actually paid to shareholders
dividends in arrears
prior year unpaid preferred dividends
ex-dividend date
date that shares sold will not be paid the dividend
IPO
first time shares of stock in a corporation are available to the general investing public
issued shares
shares sold by the corporation
outstanding shares
shares that were issued and still held by the shareholders (issued shares less shares repurchased and in the treasury)
par value
arbitrary dollar amount assigned to shares of stock
preferred stock
another class of stock that a corporation MAY issue. Has certain preferential rights over common stock
primary market
market that makes shares available for the first time (during the IPO)
record date
date that determines which investors (shareholders will receive the dividend)
secondary market
where trading for shares between willing buyers and sellers occurs
stock dividend
dividend given in the form of shares of stock rather than cash
stock split
a reduction in the par value of a share stock and an increase in the number of shares outstanding (usually when the market price gets too high)
treasury stock
previously issued shares that were repurchased by the corporation
underwriter
agent that brings the shares of the IPO to the investing public
